Personally I think the case mentioned with the insurance contesting and actually winning a 50% reduction in pay out has to make one reconsider hull insurance as a whole. In a huge percentage of cases human error is involved in a hull loss and even with mechanical failures one can argue that the insured did something or the other wrong. Every accident is preventable but nobody is perfect and that is why you do get insurance in the first place. If the insurances then do not keep up their end of the bargain and try to smear the client with a refusal to pay out, then the whole business idea of such insurance is in question in my book.
In that particular case, the flight was continued VFR after the cloud break procedure at Chambery but took a direct route rather than a safer route around the mountaineous area which would have been flyable. However, it is the nature of VFR in less than CAVOK that you may run into a situation where you need to divert because weather is worse than expected. So they would have needed to prove that the pilot acted grossly negligent in taking the route he choose. It’s a pity that this did not go to court indeed, most likely the survivors ran out of money which the insurance profited from.
While I would never do this, I understand why people save themselfs a lot of money and do not take out hull insurance. On the other hand, it would have been interesting to see which insurance company was involved here, as not all are acting the same way.
Jujupilote wrote:
Most clubs got a heads up from their insurance brokers this week, that any damage done due to a flight/taxi not in accordance with the partial (3 hrs out, 20km max from home, only household members in the airplane) will not be covered. Basically insurers are having a bad year and told their brokers they need to save their annual results and screw the customer.
I wonder are they seeking to rely on a clause already in the policy or are they writing to everyone to insert a new clause?
To me it sounds a bit like FUD. Either by someone motivated to encourage compliance with pandemic restrictions or by someone motivated to reduce insurance claims!
@MD
When you open Peter’s link, you can see the original German letter with the insurer in plain sight ;-)
You can also see the name of the pilot, because someone forgot to blacken it out once.
As to the concept of gross negligence: it is an internationally widely applied legal principle, far beyond aviation, I habe to deal with it in technical services and responsobility for unplanned outages a lot.
It is not about mistakes, but acting
- against the most basic, common sense, assumptions
- different to the most likely / expected course of action
- accepting an unnecessary risk.
Even insurers that have this embedded in their contracts pay out if the case in question is caused my a momentary lapse/mistake of the pilot, e.g. forgetting the gear / switching tanks / etc.
Characterizing gross negligence, these are typically cases where you almost have to assume intentional bad behavior, but need not prove it (as intentions are rarely documented).
Insurances naturally try not to pay out and can use this path if the case details allow. And, happy to be beaten up for it ;-) , I consider this as partly in my interest as it prevents insurances rates from climbing (faster).
Abuse by insurers in individual cases (like the one mentioned above) doesn’ IMHO invalidate the underlying principle of excluding irresponsible behavior that shouldnt be insured.
(DUI should IMHO also always be excluded in car insurance, it is simply an avoidable risk)
Personal sensitivities apart, when you fly under VFR visibly below the level of the surrounding ridges and that the ridges are obscured, making the choice of flying through a cloud in the hope there’s nothing in it (as opposed to retracing your route) is not exactly basic common sense. You don’t need a bogus excuse like “the map MSA could be misinterpreted” when you actually see the rocks around you.
These restrictions don’t apply in the UK.
But refusal to pay for a reason unconnected to the accident is bad.
Will some car insurer refuse to pay on comprehensive for an accident where the driver had broken covid law or advice, but not the road traffic acts?
(EG. Car is hit by a drunk driver while parked in a Level 3 car park, but owner/driver’s home is in Level 4.)
Mooney_Driver wrote:
While I would never do this, I understand why people save themselfs a lot of money and do not take out hull insurance.
Quite honestly, it depends. Insurance is supposed to protect against losses you can’t stomach. It’s getting close to the point where I go hull only on the Auster – the last time the renewal came around, the premium (including aerotowing gliders) was above 10% of the aircraft’s value! I kept hull insurance this year because it was clear that COVID was going to keep our glider club grounded the entire of 2020, and I could get the insurance down by £1000 by not including towing.
Insurance is basically a bet. For the insurance company to win this bet, you just have to crash at a rate that incurs costs lower than the premiums. I think once the insurance premium is getting over 10% of the value of the plane when nothing has basically changed, then dropping the hull coverage sounds like it’s more likely to leave me on the winning side. (One thing the insurer said is “older airframes are getting so much more expensive to repair” – old monocoque construction aircraft, maybe, but the cost of repairing a tube and fabric non-certified plane hasn’t been at all inflation-busting; a few years ago I paid less for a whole aileron than people are paying today for a single Alcor thermocouple!!)
For a Syndicate hull insurance avoids many problems after a crash.
If the crash pilot leaves the Syndicate, there will be no premium increase. In its first 16 years, our Syndicate had 3 hull write-offs and two repairs. In the last 21 years, no claims.
A slightly different question to the subject of the main insurance thread running (where I had a question/contribution to as well).
Assuming a number of policies with different underwriters are similar but the costs are wildly different, are they truly the same?
I was with Haywards for almost 20 years, 2 different planes. No claims, no violations, nothing. Last year my renewal went up about 50%, from 2K to 3K GBP. I queried it, no joy.
I contacted a couple of other brokers, explained the situation. Traffords was about 2.5K. Ended up going with Visicover for under 1.8K.
Visicover renewal quote just came in this year at 2.4K. A couple of days later, unsolicited call from Visicover, telling me to check my new quote – they had dropped it below 2K.
Out of interests sake I got an online quote from Flycovered – 1.5K! (this is the unlimited days flying one – and it was only 1K for a policy with 7 flying days, plus 25/day for any additional days added)
So I have 3 quotes. 1.5K, 2K, 2.5K, all for what looks about the same on paper.
1K wont make a massive difference to me, but 1K is still 1K. But I don’t mind paying more – even a lot more – if there is a difference in level of service and claims support.
I have some experience of this, mostly in car and home insurance, which is why I pay a lot more than the cheapest quote for those. A LOT more for house insurance. A few years ago I was with the cheapest quote car insurance and had an almost new Audi somewhat squashed by a lorry (driver fell asleep and drifted into my lane). No end of hassle with the insurer. Moved to NFU for the car insurance. Was hit by somebody in a car park. Completely different experience – nothing was too much trouble for them to sort out.
In the first ~15:years of a Group of which I was a member their insurance pay-outs exceeded their premiums.
Insurers go on history of current pilots, not the Group.
In the following 21+ years to present there have been NO claims.
(The insurance companies paid out without a problem.)
They made a small loss to 1999. They’ve made a good profit since.
